Monetary policy operations

Monetary policy operations are used to implement the ECB’s monetary policy decisions in financial markets. They help steer short term market interest rates, manage liquidity in the banking system and ensure that our monetary policy stance is transmitted smoothly to the economy. Together, these operations help us maintain price stability in the euro area. We use open market operations to steer interest rates. They include standard refinancing operations, fine tuning operations and structural operations (which will be introduced once the Eurosystem balance sheet begins to grow durably again). Our asset purchases influence broader financing conditions and support the transmission of our monetary policy stance to households and firms. Standing facilities help control overnight market interest rates and signal our monetary policy stance. Banks in the euro area must hold minimum reserves with their national central bank. This supports the stability of the money market and helps implement monetary policy. The PEPP was introduced as a temporary and flexible purchase programme to counter the serious risks posed to the monetary policy transmission mechanism by the COVID 19 pandemic. Our operational framework is designed in a way that enables all eligible monetary policy counterparties to participate. Credit institutions that meet the minimum reserve requirements and other eligibility criteria may access our standing facilities and tender operations. Outright transactions are open to all counterparties, with no predefined limits. To deliver on our primary objective of price stability, we need the right tools. That is why in recent years we have introduced new monetary policy instruments. The operational framework aims to steer short-term money market rates closely in line with the Governing Council’s monetary policy decisions. We use functional cookies to store user preferences; analytics cookies to improve website performance; third-party cookies set by third-party services integrated into the website. You have the choice to accept or reject them. For more information or to review your preference on the cookies and server logs we use, we invite you to: Read our privacy statement Learn more about how we use cookies We are always working to improve this website for our users. To do this, we use the anonymous data provided by cookies. See what has changed in our privacy policy We are always working to improve this website for our users. To do this, we use the anonymous data provided by cookies. Learn more about how we use cookies